Should You Think About Buying Workiva Inc. (NYSE:WK) Now?

Workiva Inc. (NYSE:WK), is not the largest company out there, but it saw significant share price movement during recent months on the NYSE, rising to highs of US$122 and falling to the lows of US$77.34. Some share price movements can give investors a better opportunity to enter into the stock, and potentially buy at a lower price. A question to answer is whether Workiva's current trading price of US$77.34 reflective of the actual value of the mid-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at Workiva’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.

See our latest analysis for Workiva

What is Workiva worth?

Good news, investors! Workiva is still a bargain right now. My valuation model shows that the intrinsic value for the stock is $108.15, but it is currently trading at US$77.34 on the share market, meaning that there is still an opportunity to buy now. However, given that Workiva’s share is fairly volatile (i.e. its price movements are magnified relative to the rest of the market) this could mean the price can sink lower, giving us another chance to buy in the future. This is based on its high beta, which is a good indicator for share price volatility.

What does the future of Workiva look like?

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Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. Although value investors would argue that it’s the intrinsic value relative to the price that matter the most, a more compelling investment thesis would be high growth potential at a cheap price. However, with an extremely negative double-digit change in profit expected next year, near-term growth is certainly not a driver of a buy decision. It seems like high uncertainty is on the cards for Workiva, at least in the near future.

What this means for you:

Are you a shareholder? Although WK is currently undervalued, the negative outlook does bring on some uncertainty, which equates to higher risk. I recommend you think about whether you want to increase your portfolio exposure to WK, or whether diversifying into another stock may be a better move for your total risk and return.

Are you a potential investor? If you’ve been keeping an eye on WK for a while, but hesitant on making the leap, I recommend you research further into the stock. Given its current undervaluation, now is a great time to make a decision. But keep in mind the risks that come with negative growth prospects in the future.

So if you'd like to dive deeper into this stock, it's crucial to consider any risks it's facing. For example, we've found that Workiva has 5 warning signs (1 can't be ignored!) that deserve your attention before going any further with your analysis.

If you are no longer interested in Workiva, you can use our free platform to see our list of over 50 other stocks with a high growth potential.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.